Co-participation: the Court declared itself competent to analyze Buenos Aires taxes
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In one of these cases, The Central Bank of the Argentine Republic (BCRA) raised the unconstitutionality of the Tariff Law 2021the Amendment to the Fiscal Code and the 2021 Budget Law through which the Buenos Aires government removed the exemption from the gross receipts tax or encumbers with this tax certain activities -repo operations, regulated by the BCRA, when the underlying or collateral assets are those authorized by said entity, and the operations on titles, bonds, bills, participation certificates and other instruments issued and to be issued in the future by the BCRA.

The BCRA claimed that the local tax regulations in question directly and seriously affect the purposes and functions that have been attributed to the entity and significantly alter the execution of monetary and financial policy at the national level. In this regard, he said that the titles, bonds, bills, participation certificates and other instruments issued by the BCRA They are monetary policy tools designed to achieve financial and exchange rate stability. and they are distorted by being taxed by the gross income tax.

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The hearing was attended by the City of Buenos Aires Gabriel Astarloa, Buenos Aires attorney;  Martin Mura, Minister of Finance and Treasury;  and Marcelo D'Alessandro, Secretary of Justice and Security.

The hearing was attended by the City of Buenos Aires Gabriel Astarloa, Buenos Aires attorney; Martin Mura, Minister of Finance and Treasury; and Marcelo D’Alessandro, Secretary of Justice and Security.

Ignacio Petunchi

Referring to the opinion of the Attorney General, the Court specified that the BCRA is a national self-sufficient entity that, according to the provisions of articles 116 of the National Constitution and 55 of its Organic Charter, it is subjected to federal jurisdictionwhile the City of Buenos Aires has the same position as the provinces in the regulatory system that governs the jurisdiction of the federal courts and, therefore,the same right to original jurisdiction of the Court. Therefore, unanimously declared that the cause corresponds to its original competence and resolved to transfer the demand to the Government of Buenos Aires for a period of sixty days.

In the other cause the Civil Association of Argentine Banks (ADEBA) and a group of banks sued the Buenos Aires Government and its Government Administration of Public Revenues (AGIP) to declare the unconstitutionality of the Tariff Law 2021 and the modification to the Fiscal Code -and its complementary regulations-, which ordered the elimination of the exemption in the tax on gross income that governed the operations carried out with titles, bonds, bills, certificates and other instruments issued by the BCRA and, as a consequence of this, that the banks had to pay said fee for the compensations or yields generated by the operations executed through those instruments, with a rate of eight percent (8%).

Horacio Rodriguez Larreta Head of Government of the City of Buenos Aires National Table Together for Change

Walter Carrera/GCBA Press

They denounced that This procedure seriously affects the use and results of the BCRA’s instruments and tools. aimed at regulating national monetary policy. Specifically, they question that the GCBA intends to tax the compensation of liquidity bills (“LELIQ”) and passive repos with financial entities (“PP”). The Court pointed out that the object and cause raised by ADEBA are similar to the one discussed in BCRAresolved that the process corresponds to the original jurisdiction of the Courtand ordered the transfer of the demand to the Government of Buenos Aires for a period of sixty days.

After that sixth meeting, In May 2022, the Minister of the Interior, Eduardo “Wado” De Pedro, regretted the lack of agreement with Ciudad. In his social networks, the official pointed out that “despite the effort made by the national government to reach an agreement, and within the framework of the law, for the amount of the transfer of the police to the City of Buenos Aires, Today we close the stage of negotiations requested by the CSJN without reaching a joint solution”.

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“During the 7 meetings held since March We show predisposition and superior proposals to reach a fair agreement in the distribution of resources with the rest of the provinces and complying with article 2 of Law 27,606. The City rejected those proposals. On 5/5, the IFC ruled in a technical report that the transfer amount for the year 2021 should be $43 billion. It had the favorable vote of 21 provinces. That’s why The national government took this opinion into account for its latest proposal, which was also rejected today”De Pedro posted on his Twitter account.

“We regret that the City authorities believe they are above the law and pretend to maintain privileges. We respect the law and a thorough technical report. Failure to do so would validate an illegality of the previous government and an arbitrariness towards all the provinces, “he questioned. Finally, the official maintained that from the Nation they cannot “maintain a decision of the Macri government that attempted against federalism and hurt the interests of all the provinces as well as employment throughout the country, while we see how it continues concentrating Argentine wealth around the port of Buenos Aires”.

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